QualitySum total of features of a product which influence its ability to satisfy a given demand“Quality of product or service is a customer’s perception of the degree to which the product or service meets his or her expectations”

What is qualityQuality isConformance to specificationConformance to requirementWhat the customer think it isCombination of feature & designValue of moneyAbility of a product to meet customer’s need

Total quality control….Integration quality developmentQuality maintenanceQuality improvementEfforts of various groups in organizationTQM…..A philosophy that involves everyone in a organization in a continual effort to improve quality and achieve customer satisfactionSix basic conceptsTo management commitmentFocus on both internal & external customerEmployee involvementContinuous improvementPartnership with suppliersEstablishing performance measure for processes

8 Essentials …..Customer satisfactionLeadershipQuality policyOrganization structureEmployee involvementQuality costsSupplier selection and developmentRecognition and rewardPrinciplesStrive for quality in all thingsThe customer is the creation of qualityImprove the process or system by which product are producedQuality improvement is continuousWorkers involvement grouped decisionTeam work and cooperationScope ……Are integrated organizational infrastructureA set of management practicesA wide variety of tools and techniques

Quality GurusW. Edwards deming (USA)Higher quality means lower costQuality means continuous improvement14 points of quality managementSeven deadly diseases and sinsDeming wheelDeming triangleDeming prize14 pointsCreate constancy of purpose for continual improvement of product/services.Adopt the new policy for economic stability.Cease dependency on inspection to achieve quality.End the practice of awarding business on price tag alone.Improve constantly and forever the system of production and service.Institute training on the job.Adopt and institute modern method of supervision and leadership.14 pointsDrive out fear. (Fear of failure, fear of change etc).Breakdown barriers between departments and individuals.Eliminate the use of slogans, posters and exhortations.Eliminate work standards and numerical quotas.Remove barriers that rob the hourly worker of the right to pride in workmanship.Institute a vigorous program of education and retraining.Define top management's permanent commitment to ever improving quality and productivity.

Deming's Seven Deadly Diseases and SinsLack of constancy of purpose (short-term quality programs)Emphasis on short-term profitsOver reliance on performance appraisalsMobility of management (job hopping)Over emphasis on visual figuresExcessive medical costs for employees healthcareExcessive costs of warranty and legal costs.Deming Wheel/Deming Cycle/P-D-C-A CycleP - Plan (process) the improvementD - Do Implement the planC - Check - Check how closely result meets goalsA - Act - Use the improved process as standard practiceDeming PrizeAwarded by the union of Japanese Scientists and Engineers U USE) to a firm or its division based on the distinctive performance improvements achieved through the application of Company Wide Quality Control (CWQC).

Capacity PlanningWhat is Capacity?Capacity is the ability to deliver in a defined timeTo have capacity a system must have some of each of the necessary transforming resources for the operationBoth input and output measures can be used:Output measures are usual for high-volume, standardised processes, e.g.:Automotive production line: number of cars per weekHotel room service: number of guests served per hourCall centre: customer calls per hourInput measures are usual for low-volume, flexible processes and for many service operations , e.g.Hospital: beds availableLaw firm: hoursUtilisation is also a useful capacity measure, it is defined as:average output rate/maximum capacity x 100%

Ability to deliver …Capacity is the maximum output rate of a production or service facility and capacity planning is the process of establishing the output rate that may be needed at a facilityCapacity is the upper limit or ceiling on the load that an operating unit can handle.The basic questions in capacity handling are:What kind of capacity is needed?How much is needed?When is it needed?

In general, production capacity is the maximum production rate of an organization.Capacity can be difficult to quantify due to …Day-to-day uncertainties such as employee absences, equipment breakdowns, and material-delivery delaysProducts and services differ in production rates (so product mix is a factor)Different interpretations of maximum capacity

Utilization = Actual output = 36 units/day = 72% Design capacity 50 units/day Determinants of Effective CapacityFacilitiesProduct and service factorsProcess factorsHuman factorsOperational factorsSupply chain factorsExternal factorsMeasurements of CapacityOutput Rate CapacityFor a facility having a single product or a few homogeneous products, the unit of measure is straightforward (barrels of beer per month)For a facility having a diverse mix of products, an aggregate unit of capacity must be established using a common unit of output (sales dollars per week)Measurements of CapacityInput Rate CapacityCommonly used for service operations where output measures are particularly difficultHospitals use available beds per monthAirlines use available seat-miles per monthMovie theatres use available seats per month

Measurements of CapacityCapacity Utilization PercentageRelates actual output to output capacityExample: Actual automobiles produced in a quarter divided by the quarterly automobile production capacityRelates actual input used to input capacityExample: Actual accountant hours used in a month divided by the monthly account-hours available

Developing Capacity AlternativesDesign flexibility into systemsTake stage of life cycle into account

Take a “big picture” approach to capacity changesPrepare to deal with capacity “chunks”Attempt to smooth out capacity requirementsIdentify the optimal operating levelEconomies of ScaleEconomies of scaleIf the output rate is less than the optimal level, increasing output rate results in decreasing average unit costsDiseconomies of scaleIf the output rate is more than the optimal level, increasing the output rate results in increasing average unit costsPlanning Service CapacityNeed to be near customersCapacity and location are closely tiedInability to store servicesCapacity must be matched with timing of demandDegree of volatility of demandPeak demand periodsCost-Volume RelationshipsCost-Volume RelationshipsCost-Volume RelationshipsAssumptions of Cost-Volume AnalysisOne product is involvedEverything produced can be soldVariable cost per unit is the same regardless of volumeFixed costs do not change with volumeRevenue per unit constant with volumeRevenue per unit exceeds variable cost per unitFinancial AnalysisCash Flow - the difference between cash received from sales and other sources, and cash outflow for labor, material, overhead, and taxes.Present Value - the sum, in current value, of all future cash flows of an investment proposal.Factors which favors over capacityWhere there is an economic capacity size below which process is uneconomicBuilding capacity is not so costlyBuying outside is not feasibleLead time to add capacity is longLost sales are viewed very negatively by trading cyclesFactors which favors addition of capacity on conservative basisAlternative capacity planning are easily availableBuild up cost of capacity is lowLead time to build new capacity is shortLost of sales have no disastrousProblems in capacity planningThere is no standard terminologyEvery vendor has a different definition of capacity management, capacity planning, sizing, tuning, and so on.Some vendors use the term capacity management to include both capacity planning and tuning. Others use it to denote tuning only.There is no standard definition of capacityOne definition is in terms of maximum throughput.Jobs per second, transactions per second (TPS), Instructions per second (MIPS) or bits per second.Another definition: Maximum number of users that the system can support while meeting a specified performance objective.Capacity planning is expressed in workload units.Users, sessions, tasks, activities, programs, jobs, accounts, projects and so on.There are number different capacities for the same systemNominal capacity, usable capacity, and knee capacityOther terms: practical capacity (usable capacity) and theoretical capacity (nominal capacity)Problems in capacity planning…There is no standard workload unit.In case of users or sessions it is difficult to characterize the workload that varies from one environment to another environment.So workload independent measures such as MIPS are still popular for forecasting.Forecasting future applications is difficultMost of the forecasting is based on the assumption that the future trend will be similar to the past.This assumption is violated if new technology suddenly emerges.There is no uniformity among systems from different vendors.The same workload takes different amounts of resources on different systems.This requires developing a vendor independent benchmark and running it on different systems.Model inputs cannot always be measuredSimulation and analytical models are used to predict the performance under different alternatives.Sometimes the inputs required for the model are not accurately measurable.Think time is commonly used in analytical models, but it is impossible to measure think time.Problems in capacity planning…Validating model projections is difficult.There are two types of model model validations: baseline validation and projection validation.Baseline validation requires that using the current workload and configuration in the model and verifying that the model output matches the observed system performance.Projection validation, requires changing the workload and configuration and verifying that the model output matches the changed real system performance.Project validations are rarely performed so the model for capacity planning is suspect.Distributed environments are too complex to modelInitial computer systems consisted of only a few components.Justifying the cost of each component was simple.With distributed environments of today the system consists of a large number of semi autonomous clients, servers and network links, and I/O devices.Workstation usage is very different from others and interactions are rather complex.It is difficult to justify the cost of each component.Problems in capacity planning…Performance is only a small part of the capacity planning problem.The key issue in capacity planning is costCost of the equipment, software, installation, maintenance, personnel, floor space, power, and climate control (cooling, humidity control).Performance modeling helps only in sizing the equipment.As the cost of computer hardware is declining, the other costs have become a major consideration in cap city planning.Capacity planning is an important problem faced by computer installation managerNumber of capacity planning tools are available in the market.Include workload analyzers that understand accounting logsSome also have built-in monitors

Tapen Gupta , Guru Nanak Institute of Management

What we plan to do about breakdowns of machines?

what steps are we going to take to prevent the breakdowns?

Preventive maintenance before breakdownMaintenance after break down happens Preventive maintenance reduces the no of breakdowns

Maintenance ManagementEfficiency of the production functionSolely depends upon the functional reliability of the production facilitiesWhich are nothing but a package of land ,building ,plants & equipment , tools & plant servicesSuch as material handling , power plant , gas & steam lines, water supply , fire fighting facilities.Subject to wear & tear

What is maintenanceFunction of production management that is concerned with the day to day problem of keeping the physical plant in good operating conditionIt is necessary to ensure the availability of the machines , building & services needed by the other parts of the organization for the performanceMaintenance ManagementMaintenance management is concerned with the direction& organization of resources in order to control the availability & performance of the industrial plant to some specified levelKeeping machinery , equipment and plant services in proper condition

Scope of MaintenanceMachines break downParts wear outBuilding deteriorate over a period of timeMaintenance covers two broad categories functionsPrimary functionsSecondary functionPrimary functionMaintenance of existing plant and equipmentsMaintenance of existing plant building and groundsEquipment inspection and lubricationUtilities generation and distributionAlteration to existing equipmentsNew installations of equipments

Objectives of maintenance mgtMinimizing the loss of productive timeMinimizing the repair timeMinimizing the loss due to production stoppagesProlonging the life of capital assetKeep all productive assets in good working conditionImprove quality of goodsMinimize accidents

Maintenance planning stepsKnow the equipmentEstablish the prioritiesInvestigate the maintenance workDevelop the repair planPrepare the list of maintenance materialPrepare the list of specific toolsEstimate the time requirementProvide the necessary safety devices

Scheduling maintenance workScheduling indicates what maintenance work has to be carried out when & also in what sequence the work to be doneWho should do the maintenance works which are already planned?When the maintenance work has to be done?Reasons for maintenance sch.Utilize the maintenance crew effectivelyUtilize the maintenance equipments & tools effectivelyReduce the interruption in productionReduces abrupt breakdown

Material Handling SystemsTapen Gupta Guru Nanak Institute of ManagementMaterial HandlingRight DefinitionMaterial handling uses the right method to provide the right amount of the right material at the right place, at the right time, in the right sequence, in the right position, in the right condition, and at the right cost.This is a relatively broad definition of material handling.Material handling ...involves handling, storing, and controlling materialadds value through time and place utilityimpacts space requirement, profits, quality, safety, and productivity

Material HandlingMaterial handling adds COST, but not VALUE.as much as 60% of total production cost20%-30% of direct labor costs50%-70% of indirect labor costsWhat’s the best way to handle materials?DON’T!!Goal: MINIMIZE COSTS OF MATERIAL HANDLINGMaterial Handling System EquationThe Twenty Principles of Material HandlingOrientation Principle: Study the system relationships thoroughly prior to preliminary planning in order to identify existing methods and problems, physical and economic constraints, and to establish future requirements and goals.Planning Principle: Establish a plan to include basic requirements, desirable options, and the consideration of contingencies for all material handling and storage activities.Systems Principle: Integrate those handling and storage activities which are economically viable into a coordinated system of operation including receiving, inspection, storage, production, assembly, packaging, warehousing, shipping and transportation.4.Unit Load Principle: Handle product in as large a unit load as practical4.5.Space Utilization Principle: Make effective utilization of all cubic space.Standardization Principle: Standardize handling methods and equipment wherever possible.Ergonomic Principle: Recognize human capabilities and limitations by designing MH equipment and procedures for effective interaction with the people using the system.Energy Principle: Include energy consumption of the MH systems and material handling procedures when making comparisons or preparing economic justification.Ecology Principle: Minimize adverse affects on the environment when selecting MH equipment and procedures.Mechanization Principle: Mechanize the handling process where feasible to increase efficiency and economy in the handling of materials.Flexibility Principle: Use methods and equipment which can perform a variety of tasks under a variety of operating conditions.Simplification Principle: Simplify handling by eliminating, reducing, or combining unnecessary movements and/or equipment.. Gravity Principle: Utilize gravity to move material wherever possible, while respecting limitations concerning safety, product damage and loss.Safety Principle: Provide safe MH equipment and methods which follow existing safety codes and regulations in addition to accrued experience.Computerization Principle: Consider computerization in MH&S systems, when circumstances warrant, for improved material and information control.System Flow Principle: Integrate data flow with the physical material flow in handling and storageLayout Principle: Prepare an operational sequence and equipment layout for all viable system solutions, then select the alternative system which best integrates efficiency and effectiveness.

Cost Principle: Compare the economic justification of alternate solutions in equipment and methods on the basis of economic effectiveness as measured by expense per unit handled.19 Maintenance Principle: Prepare a plan for PM and scheduled repairs on all material handling equipment.

Obsolescence Principle: Prepare a long range and economically sound policy for replacement of obsolete equipment and methods with special consideration to after-tax life cycle costs.

Comprehensive MH ProgramNot considered isolated but in context of following factors:Type of productPlant layoutType of production systemFactory buildingProduction planning & controlPackagingMaterial handling equipment

Chute Conveyor (Kaydirakli Konveyor)A chute conveyor is a slide, generally made of metal, which guides materials as they are lowered from a higher-level to a lower-level workstation. The shape of the chute can be straight or spiral to save space.

Advantages of Good MHSMinimizes the movement of materialEliminates unproductive handlingReduces idle machine capacityReduces idle time of labourInc the safetyQuality of materialGreater economy in store roomEffective productive control

Plant LayoutTapen Gupta Guru Nanak Institute of management

Definition & ObjectivesPlanning the optimum arrangement of facilities, personnel, equipment, storage space, material handling equipment and all supporting services, along with the design of the best structure to contain all these facilitiesEconomic handling of all material; better supervision; faster production; better product quality; flexible plant & workspace design for expansion; Improved work conditions; unidirectional workflow

Personal servicesParking areaTimekeeper officeCanteen & lunch roomRecreation roomtoiletsTHE NEED FOR GOOD FACILITIES PLANNINGPlant facilities influence operating costs and profits.Planning allows facilities and its operations (ISO 14001, etc.) to comply with laws and/or regulations.Facilities are fixed investments involving high capital-cost expenditures.Facilities are inflexible and long term commitments.The planning, design and construction of facilities require long lead times.Good planning helps to avoid disruptions in production and shipping or delivery.The quality of facilities influences the attitudes of and the ability to attract suitable employees.Industrial facilities must be planned to meet anticipated future requirements yet compete profitably today.Facilities need to be planned for an appropriate degree of flexibility, expandability, versatility…Good plans help management to take advantage of business opportunities that arise.Good planning is an aid to obtain approval and financing monies.Good planning reduces the high materials handling $ resulting from “ad hoc” expansion of plant facilities.

Ideal plant layoutAcc to F. G. Moore“A Good plant layout is one which allows material rapidly & directly for processing . This reduces transport handling, clerical and other costs down per unit , space requirement are minimised and it reduces idle machine and idle man time”AdvantagesBetter working conditions for workersMinimization in material handlingMinimization in damage & spoilageMinimization of congestion of material, machinery, workersFlexibility to adapt to changing production conditions

typeOne side road link will be requiredHeavy rush of outside transportationEase in returning empty containersRequires square floor areaSuitable for longer production line

TypesProcess layoutProduct layoutCombined layoutProject layoutCellular layoutJob shop layoutProcess layoutsimilar equipment & tasks grouped; also called functional layout; useful for low volume, high variety jobsused when small batches of different products are created or worked on in a different operating sequence

Product LayoutEquipment placed in usage sequence; also called line layout; useful in assembly work such as cars, m/cycleThe product layout (assembly line) is used when all products undergo the same operations in the same sequence

Project LayoutRaw material placed in fixed positions; also called fixed position layout

AdvantagesReduces movement of m/c & equipment;Minimizes damage/cost of movement;continuity of assigned work force

Disadvantages:Skilled & versatile workers needed due to multiple operations;skill combination may be difficult to obtain;higher pay;movement of people/material may be expensive;equipment utilization low as they are left at location for subsequent usage instead of being moved as & where needed